BILL ANALYSIS �
SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: Sjr 15
SENATOR MARK DESAULNIER, CHAIRMAN AUTHOR: desaulnier
VERSION: 9/7/11
Analysis by: Eric Thronson FISCAL: NO
Hearing date: March 27, 2012
SUBJECT:
Federal harbor maintenance taxes
DESCRIPTION:
This resolution requests that the President and Congress of the
United States increase federal funding for navigational
improvements and continued dredging in the federal channels of
California's ports.
ANALYSIS:
Prior to 1986, the federal government funded entirely the
maintenance of federal channels in the country's ports. In 1986
Congress passed the Water Resources Development Act, which
instituted an ad valorem tax of 0.125 on shipments for users of
these channels. The federal government deposits the resulting
$1.4 billion annually in the Harbor Maintenance Trust Fund to
provide a source of revenue for funding all of the maintenance
and operations dredging necessary to keep these navigational
channels open. For many years, the federal government has not
spent all the funds in the account on harbor maintenance and has
allowed a large surplus to develop totaling roughly $5.6
billion. Instead of spending this funding on maintaining the
nation's federal channels, this balance has been used to offset
other federal general fund expenditures.
House Resolution 104 and Senate Resolution 412, pending in
Congress, would ensure that the annual revenue collected from
the Harbor Maintenance Tax be fully used for maintaining the
nation's ports and navigational channels.
This resolution requests that the President and Congress of the
United States increase federal funding from the Harbor
Maintenance Trust Fund surplus for navigational improvements and
continued dredging in the federal channels of California's ports
SJR 15 (DESAULNIER) Page 2
such that these expenditures equal the amounts contributed from
the state's ports. Further, this resolution urges the President
and Congress to enact House Resolution 104 or Senate Resolution
412 to end further contribution to the surplus on the trust
fund.
COMMENTS:
1.Purpose . This resolution calls on Congress to properly
maintain the nation's ports and harbors with the revenue
provided by users for that purpose. According to the author,
California deserves its equitable share of all federal port
and goods movement infrastructure funding. Further, the
federal government has the obligation and the funds necessary
to secure and facilitate increased commercial activity at our
public ports. Many jobs and the nation's economic growth
depend on this investment. Therefore, it is reasonable to
expect the federal government to spend these revenues for the
purpose for which it collects them.
2.Underfunding channel dredging constrains trade . According to
the United States Corps of Engineers, almost 30 percent of
commercial vessel calls at US ports are constrained due to
inadequate channel depths. This sometimes necessitates
transferring products between vessels in order to "light load"
cargo ships, which increases costs and safety concerns.
Inadequate maintenance of channels due to the federal
government underfunding the program has a negative impact on
trade and the nation's economy.
3.California does not receive expenditures equal to its
contribution . Supporters note that while California's ports
facilitate the cargo value that generates over 30 percent of
the Harbor Maintenance Tax revenues, expenditures for
California state projects made out of the trust fund from
federal fiscal year 2005 to fiscal year 2008 averaged only 4
percent of the revenues collected. This resolution requests
that the federal government return funding to the revenue
source, enabling the state's ports to better maintain the
federal channels and improve the nation's trade capacity.
POSITIONS: (Communicated to the Committee before noon on
Wednesday,
March 21, 2012)
SUPPORT: Pacific Merchant Shipping Association
SJR 15 (DESAULNIER) Page 3
(co-sponsor)
International Longshore and Warehouse Union
(co-sponsor)
CA Marine Affairs and Navigation Conference
(co-sponsor)
CA Association of Port Authorities (co-sponsor)
San Francisco Bar Pilots Association
Contra Costa County Board of Supervisors
Bay Planning Coalition
City of Oceanside - Department of Harbor and
Beaches
OPPOSED: None received.